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Whether you’re a seasoned driver or just bought your first car, finding the right auto insurance is crucial. Unfortunately, auto insurance can be notoriously expensive.

For example, a single man or woman driving a 2020 Toyota Corolla Altis 1.6 (0% NCD, five years of driving experience) could spend an average of $2,165 on car insurance per year. In addition, the benefits offered by different car insurance plans vary widely, as well as their cost.

That’s why the last thing you want to do is buy a plan that doesn’t fit your needs. So what should you consider when choosing the right car insurance? And is it worth considering cheap car insurance?

Cheap car insurance doesn’t mean low coverage

According to a 2019 global cost of living survey by the Economist Intelligence Unit (EIU), Singapore remains the most expensive place in the world to buy a car.

Everything from the purchase price to registration fees and taxes adds up. As a result, many drivers may think twice about buying cheap car insurance thinking that cheap coverage equals poor coverage.

However, this is not always the case, as the lower level comprehensive policies cover the basics of what you really need, such as third party property damage and medical expense coverage.

On the other hand, although the higher level policies have a high price and additional coverage, you can rarely use all the additional features you pay for.

Let’s say you’re a safe driver who works from home most days and only drives to pick up your kids from school and the grocery store which is a few blocks away. Given your limited time behind the wheel, you’re naturally less likely to need features like eCall assistance.

READ ALSO: Car warranty vs car insurance: what is the difference

So cautious drivers who use their car for short trips on an as-needed basis can opt for an economy policy like Aviva Motor Lite that includes $500 in medical expense coverage for you and your passengers, unlimited towing, and new vehicle coverage. old replacement cover for cars less than 12 months old.

This plan also provides policyholders with child seat coverage which is a necessity for families on a budget. Plus, you also get unlimited coverage for auto accessories if they were originally fitted by the manufacturer.

Despite this, you pay around 35% less than the average compared to other full policies on the market!

Cheap auto insurance lets you customize the policy

Cheap auto insurance can come at the expense of lost benefits, but that’s not always the case. Some insurers allow you to start with a basic plan that allows for customization based on your budget, needs, and lifestyle. This can be useful when you’re less likely to hit the road.

For example, as many of us continue to work from home and attend online classes or virtual events, we are spending less time behind the wheel.

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Therefore, we can benefit from an auto insurance policy that allows for customization when we need limited coverage.

Another convenience of choosing a cheap car insurance plan that allows customization is that you will be able to purchase certain benefits while staying within your budget.

Specifically, with Aviva Motor Lite, you can purchase additional personal accident coverage for around $53.50, key replacement for $26.75, and loss of use for $80.25.

Level up as your budget changes over time

Despite popular belief, you don’t always have to pay a premium to get the coverage you want. If you carefully compare comprehensive auto insurance plans, you’ll be able to find options that cost less than the market average while still offering a wide range of helpful benefits.

For example, Aviva Motor Lite is 35% below the average for full plans and 19% below the average for similar basic full plans for the average married driver with 50% MNT.

Additionally, the average cost for safe drivers in different car types is lower than average for all comprehensive plans, as shown in the table below.

Average Cost of Comprehensive Car Insurance Plans

car type Average cost for safe drivers
Sedan 23% below average for all complete diets
SUV 17% below average for all complete diets
Luxury 22% below average for all complete diets

When auto insurance companies offer different levels of coverage, choosing a basic, inexpensive option can be a good way to get your foot in the door if you’re considering an insurer’s more expensive options.

Provided the price is competitive enough, you don’t have to worry about switching insurers and you can easily upgrade to a higher tier option with the same insurer once your budget allows.

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Consider a cheap auto insurance plan if you have a limited short-term budget and plan to allocate room in your budget for a higher level of coverage in the future.

Purchasing an auto insurance policy can be a long, complex and expensive undertaking. However, that doesn’t mean you have to spend too much to get the right coverage.

Don’t forget to compare auto insurance quotes to find the one that fits your budget, meets your needs, and also offers the option to customize the plan or upgrade in the future.

If you are looking to buy a cheap car insurance plan in Singapore, consider Aviva Motor Lite which offers $500 medical cover, unlimited towing, unlimited car accessories cover, 12 month cover and child seat.

It doesn’t hurt that consumers end up enjoying significant savings. With the current Aviva Motor Lite promotion, you will receive up to 36% off (new customer only). Redeem promotional code PMH25 to enjoy 25% off.

Additionally, MINDEF & MHA or POGIS policyholders receive an additional 15% discount on top of any ongoing promotions. Valid until July 15, 2021. Whichever auto insurance plan you choose, be sure to find the right policy for your budget, lifestyle and needs.

ALSO READ: What Factors Affect Your Auto Insurance Quotes?

Disclaimer: Promotion policy terms and conditions apply. The policy is underwritten by Aviva Ltd. The information provided here is for guidance only. For more details, click here.

This policy is protected by the Policyowner Protection Program which is administered by the Singapore Deposit Insurance Corporation (SDIC). Your policy coverage is automatic and no further action is required on your part.

For more information on the types of benefits covered by the scheme as well as the limits of cover, if any, please contact Aviva Ltd or visit IAM Where SDIC websites.

This article was first published in ValueChampion.

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